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Wealth is like a double-edged sword - carving out both comfort and unease.

It’s like they say, “More money, more problems.”

And this becomes more evident with the high-net-worth individuals (aka HNW - those with more than $1 million in liquid assets).

See, for them, it isn’t just money – it’s a weight. A responsibility that stretches far beyond the numbers on a balance sheet.

It touches their legacy, stirs old fears, and leaves that uneasy feeling of what might be lost in the generations to come.

• Remember what I wrote before on the Scottish proverb, “shirtsleeves to shirtsleeves in three generations,” which highlighted that according to surveys, 70% of wealthy families lose their wealth by the second generation and a staggering 90% by the third.

Thus, to serve these clients well, a financial advisor must do more than manage assets; they must break down the wall of emotions and understanding, where the real battles over wealth are fought.

Understanding this and anticipating their needs isn’t just helpful — it’s essential.

It’s the difference between a transaction and a trust, between just another advisor and the one who truly understands.

So, let’s take a closer look at how financial advisors can serve these specific clients better. . .

Elevate Your Wealth Management Approach: Key Strategies for Financial Advisors to Attract High-Net-Worth Clients

Let’s be clear - high-net-worth individuals have a “wealth” of options when it comes to choosing a financial advisor.

These clients are savvy and have no shortage of professionals vying for their business.

Thus, in such a competitive space, it’s not enough to simply offer traditional financial advice. Advisors need to stand out by providing tailored services that go beyond the basics.

Here are three things to start with…

The Importance of Personalized Financial Services for High-Net-Worth Clients

High-net-worth clients are increasingly demanding personalized content and engagement from their financial advisors, with a significant number of these clients switching providers due to a lack of transparency and digital engagement (meaning they want more insights).

To highlight this, according to a PWC survey¹, nearly half (46%) of high-net-worth investors are planning to switch or add wealth management relationships within the next 12 to 24 months - highlighting the importance of personalized service. This is also particularly true among younger clients.

Moreover, engaged clients overwhelmingly recognize the value of their advisors' knowledge and expertise.

A 2019 Canadian High Net Wealth Investor Research report² highlighted that 91% of engaged clients felt their advisors deeply understood their needs, compared to just 53% of less engaged clients. Additionally, 74% of these engaged clients acknowledged their advisors' strong technical skills, far surpassing the 42% among those who were not as engaged. This demonstrates that top-performing advisors are those who adopt a personalized approach, fully understanding both the life and financial goals of their HNW clients.

A strong online presence paired with content that addresses the specific needs and concerns of HNW individuals is crucial for building trust and demonstrating value.

Tools like behavioral analytics, great content marketing, and personalized communication strategies can help advisors tailor their services more effectively, leading to stronger client retention and satisfaction​

Offering Comprehensive Financial Services to Meet High-Net-Worth Client Demands

High-net-worth clients want more than just investment advice - they're asking for tax, trust, and estate planning too. But many advisors aren't even offering these crucial services.

The 2021 Spectrem survey³ highlights this gap, showing a stark contrast between what clients expect (blue bar) and what they actually received (orange).

• The gap in trust services is especially glaring with 90% expecting it but only 12% receiving it. Note that trusts are critical for high-net-worth individuals that may be preparing to pass down wealth.

This mismatch isn't just surprising - it's a wake-up call. Clients expect a holistic approach, but too often, they feel let down when it comes to comprehensive financial planning.

It's no wonder that services beyond basic financial planning are expanding rapidly, driven by the growing needs of the wealthy.

To put this into perspective, a 2023 Cerulli report shows a sharp increase in practices offering tax and estate planning services since 2017⁴ - a clear indication that financial advisors are expanding these services to attract and retain high-net-worth clients. 

This surge is likely driven by the growing need for high-net-worth individuals to manage wealth across generations. As these families prepare to pass down their fortunes, advisors have begun taking advantage of this opportunity to become indispensable partners at every stage of their clients' lives.

• Estate services for aging Baby Boomers, in particular, offer a pathway to forging deeper client relationships.

Meeting these expectations means becoming more than just an investment advisor. The key to retaining HNW clients is to be their one-stop shop for all things wealth-related.

Expand your services, and you'll not only meet their needs - you'll exceed them.

Digital Engagement Strategies for Younger High-Net-Worth Clients

Younger high-net-worth investors prioritize digital capabilities and hybrid advice models.

Now, some might dismiss this, thinking the younger crowd isn’t the core market.

But here’s the thing: as wealthy Baby Boomers pass down their fortunes, their kids and grandkids will inherit that wealth.

• Or said another way, yesterday’s wealthy Baby Boomer is tomorrow’s Millennial millionaire.

That’s why enhancing the digital experience is crucial. Younger HNW clients value the convenience and familiarity of technology. They want a hybrid model that blends digital tools with the personal touch of a financial advisor.

The ThoughtLab “Wealth and Asset Management 4.0^5” report backs this up, showing that 89% of investors - whether high-net-worth, ultra-high-net-worth, millennials, or baby boomers - prefer digital communication and engagement, especially through mobile apps. Websites also remain popular.

Financial advisors must adapt to these preferences and anticipate what the next generation of high-net-worth beneficiaries will need.

The last thing a financial advisor wants is for a beneficiary to visit their site, scoff at its outdated design or lack of infrastructure, and decide to move their money to a more "modern" advisor.

Building Long-Term Relationships with High-Net-Worth Clients Through Personalized Service

Wealth management is more than just numbers on a balance sheet – especially for high-net-worth clients.

It’s about legacy, responsibility, and the future. To truly serve these clients, financial advisors must go beyond the basics. They need to offer personalized service, expand into trust, tax and estate planning, and move into the digital age.

The advisors who rise to this challenge will become more than just financial managers – they can become trusted partners.

By understanding the real weight of wealth and addressing the needs of today and tomorrow, they’ll secure not just their clients’ loyalty, but improve their own practice as well.

Are you ready to expand your services and attract more high-net-worth clients? Contact Dunham's Business Development Team today to learn how we can help you tailor your marketing approach, enhance trust services, possibly show innovative advisory fee structures, and build lasting client relationships.

Sources:

1. High net worth investor survey: PwC
2. What engaged HNW clients reveal about advisors | Advisor.ca
3. 4 Pillars for retaining high-net-worth clients from Envestnet
4. How financial advisors win high net worth clients ꟾ BlackRock
5. Wealth-4.0_eBook_Final.pdf (thoughtlabgroup.com)

Disclosures:

This communication is general in nature and provided for educational and informational purposes only. It should not be considered or relied upon as legal, tax or investment advice or an investment recommendation, or as a substitute for legal or tax counsel. Any investment products or services named herein are for illustrative purposes only and should not be considered an offer to buy or sell, or an investment recommendation for, any specific security, strategy or investment product or service. Always consult a qualified professional or your own independent financial professional for personalized advice or investment recommendations tailored to your specific goals, individual situation, and risk tolerance. All examples are hypothetical and are for illustrative purposes only.

Information contained in the materials included is believed to be from reliable sources, but no representations or guarantees are made as to the accuracy or completeness of information.  This document is provided for information purposes only and should not be considered as investment advice.

Dunham & Associates Investment Counsel, Inc. is a Registered Investment Adviser and Broker/Dealer. Member FINRA/SIPC. Advisory services and securities offered through Dunham & Associates Investment Counsel, Inc.